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CBRE Debuts Greater Salt Lake Area Multifamily Market Report

Report highlights multifamily market trends and statistics for the first half of 2016, which illustrate high construction levels and all-time high average rental rates

Salt Lake City - September 19, 2016 – The Salt Lake City office of CBRE has released its inaugural Greater Salt Lake Area Multifamily Market Report, which covers market data for the first half of 2016. Produced by investment specialists Patrick Bodnar and Eli Mills, the report contains the most current and comprehensive multifamily data available for the Salt Lake area/Wasatch Front, highlighting market performance from Salt Lake, Utah, Davis and Weber Counties.

Report HighlightsMultifamily market fundamentals in the area reflect a tight rental market. Overall vacany along the Wasatch Front was at just 4.5 percent at mid-year; this decrease in vacancy was driven by strong demand, which has supported increasing rental rates. In Salt Lake County, rents have increased by 26 percent since 2011. Developers have responded to these strong market fundamentals, which is evidenced by a great deal of construction that is currently planned or taking place.

“Multifamily developers in Utah have been outpacing typical expectations in an effort to play “catch up,“ noted Bodnar, senior associate. “Units under construction along the Wasatch Front total 9,530. Another 12,219 units have been identified as potential starts. This will greatly help the pent-up demand.”

In the near term it is anticipated that demand will remain robust, although some overbuilding in the next 24 months will help stabilize the market, balancing supply and demand levels.

Another item that stood out in the report is the price renters are willing to pay; the Wasatch Front achieved an all-time average high rental rate of $1.15 per square foot in 2016. The Downtown and Sugarhouse locations greatly influenced this average, commanding the highest average rents in the region at $1.52 and $1.45 per square foot, respectively. For comparison, average rental rates in Utah, Davis and Weber Counties were $1.08, $1.07 and $0.82, respectively, representing incremental increases from the previous four years.